By Winnie Zhu
Nov. 12 (Bloomberg) -- China Oilfield Services Ltd., a unit of the nation's largest offshore oil producer, fell in Hong Kong trading after Goldman Sachs Group Inc. downgraded the stock on slumping crude prices.
Shares of China Oilfield dropped as much as 49 Hong Kong cents, or 10 percent, to HK$4.25, the biggest decline in a week. They were at HK$4.33 as of 12:07 p.m. The Benchmark Hang Seng Index fell 2 percent to 14,155.26.
Crude oil prices in New York fell for a second day to near a 20-month low on speculation the International Energy Agency will cut its oil demand forecast for next year because of the slowing global economy. The near-term oil price outlook increases concern over exploration spending trends, Goldman said in a report today.
``Cutbacks in exploration spending quickly follow a material fall in oil prices, and given that we expect oil prices to fall significantly next year. We think this would weigh heavily on oil services industry revenue,'' analysts led by David Ng and Nilesh Banerjee said in the report.
The stock's rating was cut to ``neutral'' from ``buy.''
To contact the reporters on this story: Winnie Zhu in Shanghai at wzhu4@bloomberg.net.
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